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Itr is to be filed in the proprietor pan or prop. firm pan ?

CA Abhishek Singh (practice) (2106 Points)

30 June 2012

Hello everyone, Mr. X is proprietor of M/s.X & co. A proprietorship firm.

Mr. X two pan cards one of himself and other one of m/s. x & co.

in the p.y. 11-12 Tax has been deducted at source in the name of M/s. X & co. and firms Pan no.

Now Mr. X wants to get the TDS refund. How should his return of income will be filed whether in his personal PAN or proprietorship pan ? waiting for your reply .

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11 Replies

Deepak Parsai (Future CA) (623 Points)
Replied 01 July 2012

In my opinion, you should use firm's pan to claim refund. Since as per Pan ledger(form 26AS) will show tds and not your pan ledger. Check 26AS statement and claim refund against that to tally your position.

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(Guest)

Mr. Abhishek while deciding the factors you have to bear in mind:-

1. If you use firms PAN No. you can't avail the basicexemption limit available to an individual.

i.e you have to pay tax on the profit of Re.1 also @ 30% + EC. i.e TDS is 55,000 and profit is 180000. The tax on profit works out to 54,540. Thus you will get a refund of 55000-54540=460.

If you use individual's PAN No.you will get entire amount as refund.

Now in the present case either you ask the deductor(s) to file a correction return changing the PAN No. from firm's to individuals. If doubtful of this ....................(use your expert brain to limit the business activity to the amount deducted in the anme of the firms's PAN)

Last but not least is immediately surrender (I mean do not use) the firms PAN for the above reason.

1 Like

CA Abhishek Singh (practice) (2106 Points)
Replied 02 July 2012

thanks everyone for your reply. following is the detail of the firms printed on the orginal pan card. kindly let me know whether it belogs to firms/company/trust/aop/boi/individual.

" MEGA CERTIFICATION COUNCIL"

06/01/2011

AAABM1014C "

I can view the 26AS statement in the income tax website. but couldnot find whether it is issued as partnership firm/company/AOP etc.

SUBODH KUMAR (ARTICLE) (57 Points)
Replied 02 July 2012

It is issued as BODY OF INDIVIDUAL, because 4th letter of PAN denotes status of assessee & in the given PAN fourth letter is "B" so in my openion it is BODY OF INDIVIDUAL.

SUBODH KUMAR (ARTICLE) (57 Points)
Replied 02 July 2012

Forth field of pan denotes assessee status :
for individual="P"
for Company="C"
for Trust ="T"
for partnership firm="F"
Body of Individual:"B"

Association of persons:"A"
HUF="H"
Local authority:"L"
Govt.="G"
judicial artificial person:"j"

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Rajesh Dubey (Chartered Accountant) (144 Points)
Replied 02 July 2012

Proprietor's PAN..

Ritika Pundir (CA) (154 Points)
Replied 02 July 2012

How can the proprietor and his firm be issued different PAN? Proprietor is the sole owner, wont the firm's return go in the proprietor's name and pan?

Secondly, the pan here is of a body of individuals, not proprietorship firm. Therefore, PAN of the BOI.

Kindly correct if wrong.

MAHESH GARG (AUDIT EXECUTIVE) (334 Points)
Replied 02 July 2012

First of all Know about PAN:

PAN is a 10 digit alpha numeric number, where the first 5 characters are letters, the next 4 numbers and the last one a letter again. These 10 characters can be divided in five parts as can be seen below. The meaning of each number has been explained further.
1. First three characters are alphabetic series running from AAA to ZZZ
2. Fourth character of PAN represents the status of the PAN holder.
• C — Company
• P — Person
• H — HUF(Hindu Undivided Family)
• F — Firm
• A — Association of Persons (AOP)
• T — AOP (Trust)
• B — Body of Individuals (BOI)
• L — Local Authority
• J — Artificial Juridical Person
• G — Government
3. Fifth character represents first character of the PAN holder’s last name/surname.
4. Next four characters are sequential number running from 0001 to 9999.
5. Last character in the PAN is an alphabetic check digit.
Nowadays, the DOI (Date of Issue) of PAN card is mentioned at the right (vertical) hand side of the photo on the PAN card.

Secondly the right reply to your query is given by Ritika Pundir.

Proprietorship Firm is not alloted separate PAN No. as income from the business is solely of the proprietor and return is filed in the name of the proprietor. Also if for any reason double PAN No. are alloted then you are required to immediately surrender one PAN No. intimating to the IT department.

Thirdly I again agree with Ritika and subodh

according to the details given by you it is PAN No. of Body of individuals and not a proprietorship Firm. Income will thus be assessed treating it income of Body of Individuals.

Fourthly, I would like to correct Ram Babu.

The tax bracket of 30% explained by him is for Partnership Firm and not Proprietorship Firm.

And as i had said already there is no proprietorship firm assessed and income is assessed in the hands of Individual or say Proprietor so tax bracket is not an issue.

Thus i hope it has become quite clear and simple for you now that you will have to file return of BOI and thereon claim TDS refund in the PAN No. of Body of Individuals.

Regards

1 Like

sk shamsul haque (accountent) (22 Points)
Replied 03 July 2012

a company or BOI can not be formed by one person. so the above business is a propritorship business. only personnal PAN should be taken to file return.

(Guest)

nO Comments.

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Digambar Nana Chaudhari (Article) (22 Points)
Replied 15 March 2014

Hello everyone

I have received income tax notice,the notice is regarding non filling of income tax return for last 3 to 4 years. Can i file ITR for last 3 to 4 years?

Please guide me.